Erythropoietin and its receptor are critical for erythropoiesis and are also expressed in the nervous system. Prior to death in utero due to severe anemia mice that lack the erythropoietin receptor have fewer neural progenitor cells and differentiated neurons are markedly sensitive to hypoxia, suggesting that during development erythropoietin stimulates neural cell proliferation and prevents neuron apoptosis by promoting oxygen delivery to brain or by direct interaction with neural cells. We determined erythropoietin receptor expresison is higher in neural progenitor cells and is down regulated but persists in mature neurons. Erythropoietin stimulates proliferation of neural progenitor cells but less effective than FGF, and is not effective in the presence of FGF. Mice that selectively lack erythropoietin receptor in neural cells but express erythropoietin receptor in hematopoietic tissue driven by the endogenous promoter exhibit normal hematopoiesis and survive to adulthood. However, these mice exhibit increased apoptosis in the developing brain and reduced neural progenitor cell in the adult hippocampus and subventricular zone with increased sensitivity to glutamate neurotoxicity. In traumatic brain injury, erythropoietin neuroprotection was present but reduced in mice that lack erythropoietin receptor in neural cells. Therefore, endogenous erythropoietin signaling promotes cell survival in embryonic brain and contributes to neural cell proliferation in adult brain in regions associated with neurogenesis and to neuroprotection.